Neo Floor, which has developed a business strategy suited to the new circumstances, has approached and negotiated with major local and foreign distributors to close orders in recent times.
A member of the Pha Le Group ecosystem, Neo Floor completed its plan to expand production scale to 14 million square metres in Vietnam in October. The company is preparing for a multi-million dollar investment plan to expand its rigid core vinyl floor production system to 26 million sq.m of floor space annually to meet the growing needs of its customers.
|Le Quang, COO of Neo Floor
Le Quang, COO of Neo Floor, said that the company holds the belief that upon the completion of the distribution system and the attainment of a sufficient level of output, it will be capable of satisfying the demands of major purchasers, including Tucsun, CA Flooring, Discount Hardwood Floors, Old Master, and Town and Country Ceramic Tiles.
Neo Floor disclosed its intention at its shareholders’ meeting conducted this summer to allocate domestic consumption to a mere 10 per cent, with the remainder of its product portfolio being designated for export. Additionally, the corporation has acquired from a European partner the copyright for key locking technology.
The competitive advantage of Neo Floor is founded upon two factors. Firstly, CaCO3 stone powder comprises three-quarters of the basic materials used in the production of rigid core vinyl floors.
The company presently possesses a CaCO3 quarry situated in the central province of Nghe An, which boasts reserves exceeding five million cu.m. As a result, the project benefits from a raw material area that guarantees American origin and quality.
Secondly, the firm’s substantial research and development expenditures of hundreds of thousands of US dollars have yielded specific outcomes. Neo Floor’s scientists have developed a formula for combining additives after two years of research, thereby refining and dominating the entire rigid core vinyl floor production line.
Neo Floor research indicates that the demand for such flooring in the US market reaches approximately 15,000 containers per month, with China supplying more than 10,000 containers, Vietnam 4,000, and India, Thailand, and Cambodia comprising the remaining suppliers.
The value of Vietnam’s rigid core vinyl flooring exports in the US market has increased on an annual basis. The total export value of such flooring from Vietnam to the US reached $939 million in 2022, representing 17 per cent of consumption value. Export output reached 125 million sq.m, which represents 28.7 per cent of US consumption, according to the General Department of Vietnam Customs.
“Neo Floor has implemented a state-of-the-art management system and forged a collaborative alliance with major distributors of construction materials in the US,” Quang said. “Commencing in 2021, the largest supermarket chain in the US, Home Depot, has carried the organisation’s rigid core vinyl flooring products. Significant orders are also being finalised with additional significant distributors such as T&A Supply, Menards, Ollie’s, and numerous others.”
|Substantial funding backs up SPC flooring opportunities
Imports of stone-polymer composite (SPC) flooring into the US market has declined, creating an opportunity for non-Chinese manufacturers like Neo Floor. VIR ‘s Van Nguyen discussed this with Neo Floor CEO Le Quang.